Tasmania in for Electricity Price Hike

A report prepared for Tasmania’s Economic Regulator has found the electricity bill of the average household is set to rise by more than $300 per year, under the new carbon tax.

It predicts that Aurora Energy will need to raise its prices by a further 6.5 per cent to recover the loss. This rise would be on top of a pre-existing increase of almost 9 per cent, should the state-owned power company request it.

With a price increase of 15 per cent from July 1, consumers would be expected to pay another $340, increasing the the average household power bill to about $2,500 a year.

Energy Minister, Bryan Green, says significant compensation from the Commonwealth will be available to householders under the carbon tax package and most will be better off.

However, the Opposition’s energy spokesman, Matthew Groom, says he is not convinced

there will be enough support for those who are already feeling the pressure.

“They have literally hit the wall when it comes to power costs and what Tasmanians desperately need is not increased power bills but in fact immediate power price relief.”

“That’s why the Tasmanian Liberals are saying hand back the carbon tax and the Tasmanian Government needs to back the Liberals position, ” Mr Groom said.

The Liberals say the report provides further excuse for Hydro Tasmania to pass on any expenses it receives as part of the tax to be passed on to customers.

Leading economist, Saul Eslake, believes Tasmania’s low income earners will be compensated for the effects of the carbon tax on power bills.

“Understandably they might not see it that way, or be a bit cynical about it.”

“The maths simply are that lower income Tasmanians in particular will get more out of the combination of reductions in income tax and increases in pensions and family benefits, and the like, than they will pay by way of increased bills because of the carbon tax,” he said.

Aurora Energy has until the end of next month to submit its new tariff proposal to the Economic Regulator.